IRS Appeal When They Say “No”
One of the great parts of representing taxpayers with IRS appeal problems is that the law gives them plenty of rights. One of my favorite is the appeal.
IRS Myth 12: Once You Owe The IRS Money, It Never Goes Away
Every year, my clients save millions of dollars because the time for the IRS to collect has expired. The Statute of Limitations for when you owe the IRS money is 10 years from the day the tax was assessed. Some of these people have been declared uncollectible by the IRS or have been making small…
IRS Myth 11: Once You Get Audited, The IRS Will Never Leave You Alone
The IRS audits less than 1% of the total tax returns filed. There is usually a reason a particular return gets selected.
IRS Myth 10: The IRS Cannot Take Your House If It Is Your Homestead
While it is true that the IRS cannot one day put a lock on your residence and sell your house, they can take action to do just that. If a Revenue Officer is convinced that it is in the best interest of the government, he or she will request the Justice Department file a lawsuit…
IRS Myth 9: If You Owe The IRS Too Much Money, You Will Go To Jail
At my first meeting with a prospective new client, their biggest fear is people is going to jail for not filing tax returns or not paying outstanding debt. As a general rule, all the IRS wants from most people are all of the tax returns and an agreement to resolve the balance owed.
IRS Myth 8: If Your Business Owes Money, You Are Not Personally Responsible.
Many small businesses are unable to pay their payroll taxes for various reasons. Often, they do not have enough money to pay all of their bills. If they do not pay their rent, they will get evicted. If they do not pay their utilities, they will be shut off. If they do not pay their…
IRS Myth 7: Once You File A Joint Tax Return, You Cannot Get Out Of It
When a married couple file separate returns, they can later amend and file a joint return. When they initially file a joint return, they cannot then file separate returns. However, under certain circumstances, one party may be able to separate the liability.
IRS Myth 6: The IRS Never Makes Deals To Pay Less Taxes.
If someone wants to file an Offer in Compromise to settle their tax debt, the IRS will not make a business decision. In the real world, if you owe someone $100,000 and offer them $80,000, the creditor will probably accept the deal. However, the IRS will never leave money on the table.
IRS Myth 5: The IRS Never Forgives Penalties
Failing to file a personal tax return on time carries with it a 5% penalty per month, maxing out at 25%. Filing to pay personal taxes on time initially brings with it a .5% penalty per month, also stopping when it hits 25%. If both penalties apply, the maximum monthly liability of a taxpayer is…
IRS Myth 4: This Is America. You Are Innocent Until Proven Guilty.
With the IRS, it is the other way around. The burden of proof is usually on the taxpayer. If a Revenue Agent auditing your tax return thinks you under reported your income or over reported your expenses, it is up to you to prove you did not. It can be difficult to prove a negative,…